Earlham Talks Online

Just released! Videos of three talks from our Novem­ber 2014 war tax re­sis­tance con­ference, held at Earl­ham School of Reli­gion in Rich­mond, In­di­ana: "What does the Su­preme Court's Hob­by Lob­by deci­sion mean for war tax re­sis­ters?" by Pe­ter Gold­berger; "Qua­kers and the war tax con­cern: unfin­ished bus­iness?" by Lon­nie Val­en­tine; and, "Stra­tegizing for so­cial change in 21st cen­tury Amer­ica" by Joan­na Swang­er.

Summer Reading

Books by and about war tax resisters. Check back now and then as we'll keep adding to the list.

More....

A Collection of Readings on Money
By, For, and About War Tax Resisters and Resistance

What’s Your Interest

The National War Tax Resistance Coordinating Committee
(NWTRCC) has in its office a slim booklet called “Interest for
Radicals: A Collection of Polemics,” put together by Ed Agro and Aaron Falbel,
two war tax resisters from New England. Interest is, well, an interesting
subject. Why should it be important to war tax resisters?

By pooling together the money we refuse to pay to the war
machine, war tax resisters have the opportunity to build a different economy.
In fact, the actual building of alternative economies and alternative economic
institutions is the “other half” of war tax refusal.

Many alternative funds use the instrument of interest
towards a greater good. Some alternative funds refuse to take interest. Why?
Read below to find out more. Whichever way we come down on the topic of
interest, the editors of the booklet urge war tax resisters to engage in the
dialogue and to create more people-centered economies.

There are seven short articles in the booklet. We are
reprinting three of them. The first, as it appears first in the booklet, is by
Juanita Nelson. The second is by Bob Irwin, and the third is a rejoinder by
Juanita.

On Interest

By Juanita Nelson

I consider war tax refusal an essential step in the direction of a saner
society, when a society is squandering its substance on war waging and
preparation. But if I stop at that point I haven’t got the point. Another
imperative for me is to look at economics, beyond the use and abuse of federal
tax funds, and to take whatever faltering steps I can in the light of insights
as I gain them.

An insight I gained many years ago concerns interest, or the ability of money
to multiply, to grow, to reproduce itself. I examined the concept inside out,
upside down, top to bottom, and concluded that money has no reproductive
powers. A hundred pennies sealed in a jar for however many years remains a
hundred pennies. It makes no difference if the jar rests on your desk or in
the vault of a bank or is invested in the Sleight-of-Hand Corporation.
(Experiment with the jar of pennies on your desk.)

Interest is a construct invented so that, as John Ruskin observes in
Unto This Last, some can take advantage of other’s distress. If I
lend you a hundred dollars that I have no need of at the moment, or that I
obviously can manage without, why would I demand a hundred and ten from you
within a year instead of merely the original hundred? I would have done
nothing to deserve the ten dollars. It would result from work you had
performed and therefore, according to my calculations, I would be extracting
ten dollars worth of your labor.

For a paragraph, I’d prefer to remove the discussion from the distraction of
dollars or money, only a representation of the real thing. What I’m really
dealing with is the product of labor applied to natural resources, the only
combination I am aware of which yields wealth. (No matter how many dollar
bills, of whatever denomination, are thrown to the ground, they cannot dig a
hole, as one person can.) So I, having a surplus, let you use ten bushels of
corn to supplement your poor crop, a supplement without which you must go
hungry much of the winter. But I stipulate that the next year you must return
to me not the ten bushels you had from me, but eleven. If we assume that it
takes equal amounts of time to grow a bushel of corn, I would be usurping a
bushel of corn’s worth of your time, your labor. With what justification?

So, the first thing to ask about interest is, what is it? And the answer
appears to be: appropriation of another’s labor — though the ultimate victims
of that appropriation may be many times removed from our immediate view —
maybe just a polite way of saying robbery. If this sounds harsh, listen to
Cicero in De Officius, 44 B.C.: When Cato was asked
what was most profitable in the way of property, he replied, “good pasture.”
And when the man who asked the question said, “And what about lending at
interest?” Cato answered, “What about manslaughter?” I was pleased also to be
backed up by economist Maynard Keynes: “At the base of today’s acquisitive
society is legalized usury, or lending money at interest.”

Pioneer Valley War Tax Resisters reluctantly keeps a small bank account to
enable check processing. Some years ago we agreed that taking interest on the
piddling sum was contrary to all we believed in. We approached the bank to ask
that we not be credited with interest. We went from a surprised receptionist
to a nonplussed teller to an adamant president, who told us their charter
required them to give us the interest. It was only after I recounted an
experience in Philadelphia where I had been allowed to forego the unwanted sum
that the president decided he could honor our request. Not only that, he
consented to what we’d mentioned only offhandedly because we thought it would
be too much — we could return the interest we had previously collected! Which
we did. We had won permission not to take money we didn’t want.

It might be instructive to enumerate all the reasons given as rationale for
interest, why some consider it even a right and reasonable thing. But that can
wait for another issue, perhaps another author.

Interest and Economic Transformation

by Bob Irwin

I am convinced that we need a better economic system in order to move from the
war era to global peace; but I disagree with the idea that interest is an evil
to be eliminated.

Amid the impassioned attitudes and invoking of authorities, a simple reality
has been obscured. The article that initiated this discussion advocates that
we refuse interest money earned by any bank deposits we may have, and insist
instead that the banks keep it! Money that could be given to aid the poor at
home and abroad, or to fund efforts to end oppression and war, or even just to
make our own lives easier — this, we are told, should instead be donated to
bankers!

It would take a Mark Twain to comment adequately on the irony of such a
position being advocated by any dedicated radical. Do any of us really believe
the average banker is our best ally in the struggle for peace and freedom? It
would be better, I think, to take our interest dollars and burn them on the
sidewalk in front of the bank than to leave them to the bankers — and better
still if some poor person snatched the money from our hands before it turned
to ashes.

Whether Aristotle (who considered women inferior and favored slavery) or
Gandhi or any other famous name approved interest or not is no excuse for not
thinking the matter through for ourselves. (Anybody remember the slogan
“Question Authority”?)

Let me briefly offer another view of the nature of interest, and then sketch
the role interest plays in three important efforts to transform economic life.

How “barren metal” can “breed” is no more mysterious than how an empty room
can earn money. Interest is not robbery; it is rental income on money. It is
no more (nor less) ethically dubious than subletting a room in one’s house or
apartment. (Any “voluntary” exchange between people with unequal bargaining
power can be unfair, but this point applies to all transactions, not just to
money-lending.)

Like other rent, interest is related to time. So is value. A dollar can be
worth more to me now (when I need to finance attending school) than $1.20 will
be to me later (when I can pay the dollar back — plus interest — out of my
education-enhanced higher earning capacity.) Most money borrowed at interest
is sought because doing so is similarly advantageous to the borrower; not (as
Juanita maintains) primarily out of “have-not” desperation. Paying interest is
not giving something for nothing; it’s paying for the advantage — the value —
of having money sooner rather than later.

I believe we should earn as much interest as we can — within the ethical
bounds of socially responsible investment — and use the money for good
purposes. Rather than comment further on all the arguments, parables, and
moral pronouncements that have been offered, I want to show the positive role
interest is playing in efforts to create a more just socio-economic order.

In the Mondragon region of Spain in 1955, a radical priest devised a financial
structure for cooperatives that overcomes certain defects of coops throughout
the preceding 150 years. …The Mondragon coops have a complex system of
internal accounts and interest payments that provides ways workers can
gradually buy in and later get their expanding share out. The Mondragon
system, starting with one five person coop in 1955, now employs 21,000 persons
in secure and well paid jobs in 170 plus coops, each with superior working
conditions and a lower ratio of highest to lowest salaries than in capitalist
firms.

Crucial to the Mondragon complex is a people’s bank which pays interest on
workers’ savings, loans money (at interest) to start up new coops, and uses
its surplus for aiding troubled firms, providing social welfare, and expanding
worker controlled employment. At last word the Mondragon complex had begun to
take over capitalist firms and convert them to worker management. (I hope they
start operating in the U.S. soon!) But if
blocked by a moral stance against interest, this new economic system could
never have developed.

The Mondragon model is relevant to industrial life everywhere. Equally
important for the poorest of people in any country is the Grameen Bank of
Bangladesh, at the heart of which is money lending and repayment with
interest. Recognizing the resourcefulness and hard work it took for poor
Bangladeshis to survive, a visionary speculated that if they could get a small
loan (for a beehive, a goat, or some chickens) they could run a little
business and begin to upgrade their conditions (fix the roof, get safer
drinking water.) Based on five person support groups which help borrowers
(mostly women) solve problems, keep their husbands from grabbing the income,
and stay on track with their loan repayments, the Grameen Bank has since 1976
helped over one million persons lift themselves above the most abject poverty.
In the process it has also shifted power from men toward women and reduced the
power of traditional exploitative high interest local money-lenders.

The spectacular success of this system of “micro loans” and support groups — a
synergic combination of individual initiative and group solidarity combining
the best ideals of capitalism and socialism — has caused it to spread to at
least eight countries. In the U.S. it has
recently begun aiding poor people in Arkansas, Chicago, South Dakota, and
Maine.

I regard Mondragon and the Grameen Bank as the world’s most important economic
alternatives — the dynamic beginnings of a post capitalist economic system. I
see no way they could function without interest, and I hope the lessons and
significance of these transformation projects will be weighed against
judgments about interest handed down from the past.

A much smaller and (so far) less important undertaking, but one which
highlights the issue of interest with startling directness, is the “Financial
Independence” program of the New Road Map Foundation. These people offer a
plan for “Transforming Your Relationships with Money,” through which you learn
to increase your savings rate and lower your living expenses until you can
live entirely off interest income!

They ask, wouldn’t you like to have the economic freedom to work full-time (if
you so choose) for peace and justice causes? This may sound like an altruistic
cover for a goal really designed for lazy greed-heads, but its proponents
report that those seeking financial independence for altruistic reasons have a
higher success rate in achieving financial independence than those doing it
for themselves.

This small movement of people are striving to overcome the common addiction to
a consumerist lifestyle and the sense that we are condemned to do compulsory
work for money rather than do freely chosen work expressing our values. I
don’t totally agree with their position. But their arguments seem to me at
least as sound as those of interest’s opponents, and I challenge anyone
seriously interested in the interest debate to examine their materials.

Juanita’s Rejoinder (excerpted)

It seems to me that Bob did not deal with my main query, which was “Where does
interest come from?” I conclude that it comes from the labor of those who pay
the interest. The assumption that it does some good is another matter. There
are arguably some good results from war, but I’d rather do without war!…

As for the quixotic notion of refusing bank interest, which seems to set teeth
on edge, my decision is based on the desire to break a cycle. If interest is
not a good thing (as I believe), then why should I take it? Is it any more
pristine in my hands than in the bank’s? As for the poor person I’m
shortchanging, I’ll seek another way of helping her or him, rather than
perpetuate one of the very instruments that created the poverty in the first
place. Maybe we’ll go together and picket to protest the bank’s taking and
giving interest, while we share whatever food I have. (I’m not against burning
money, by the way, I just don’t see the point of it, except as a
demonstration.)…

All of God’s dangers ain’t interest. I have no economic blueprint, but I sure
do have ideas about a lot of aspects. I think of interest as a lead-in to the
whole vexing problem of economics. What I’d like to do sometime is to be able
to talk face to face, so that we might get beyond polemics and into fruitful
searching.